Budget stability welcome, opportunity remains for feasibility focus
The Property Council of Australia today said the NSW Government’s 2026-27 Budget was a stable and predictable framework for the property industry, but that the opportunity remained, ahead of next year’s NSW election, to focus on the step-change needed to unlock housing supply at scale.
Property Council NSW Executive Director Katie Stevenson said the Budget provided certainty for industry at a time of growing economic pressure, with no new unexpected taxes or cost increases impacting investment and development.
“In a challenging economic environment, the certainty offered by this Budget is very welcome,” Ms Stevenson said.
“Importantly, there are no new taxes or charges hitting the property sector, and that provides confidence for investors and developers making long-term decisions.”
Ms Stevenson said the Budget builds on the Government’s broader reform agenda, with support for measures advocated for by the Property Council that will help unlock more housing delivery and investment across the development sector.
“The extension and expansion of the Pre-Sale Finance Guarantee – which the Property Council has championed and was announced at our NSW Housing Summit earlier this month – is a critical step forward in getting more projects moving, particularly as access to finance remains a key barrier to delivery,” Ms Stevenson said.
“The Government has also made a positive step to attract global capital through changes to the foreign investor surcharge for qualifying build-to-rent and retirement living developments, helping ensure NSW remains competitive for large-scale investment.”
Ms Stevenson said the Budget’s investment in Modern Methods of Construction would also play an important role in lifting productivity across the sector. The Property Council’s 2026-27 Pre-Budget Submission identified MMC, including prefabricated and modular buildings, as a critical opportunity to address rising construction costs, labour shortages and slowing productivity.
“Modern construction methods can help reduce build times, improve efficiency and support the industry to scale delivery more quickly,” she said.
“The announcement of $4.9 million to replace the BASIX system will also help to provide faster housing sustainability assessments aligned with NSW sustainability and housing targets.”
The Budget also includes $3 billion over four years in the Planning, Housing and Infrastructure portfolio, supporting the pipeline of housing, precincts and infrastructure needed to underpin long-term growth and liveability.
Ms Stevenson said the Budget did not fully address the core feasibility challenges that continue to hold back housing delivery across NSW.
“Housing feasibility remains under real pressure from construction costs, contributions, taxes and market conditions,” she said.
“While this Budget provides welcome stability amidst ongoing global uncertainty, it doesn’t yet deliver the step-change needed to turn approvals into homes.”
“Future reform must focus on addressing the cumulative impact of government taxes, charges and contributions on project viability.
“If we are serious about boosting housing supply, we need a clear focus on feasibility – including how government taxes and charges impact the ability to get projects off the ground,” she said.
The Property Council has consistently called for reform to the timing of infrastructure contributions, including the Housing and Productivity Contribution (HPC), to better align with how projects are financed and delivered.
“We’ve consistently called for these payments to be deferred to the occupation certificate stage, when projects begin generating revenue, rather than being levied upfront during the early stages of development,” Ms Stevenson said.
“Deferring the timing of paying contributions is a practical reform that would significantly improve project cashflow, reduce feasibility pressure and help convert more approved developments into construction.
“Without changes to the timing and structure of government taxes, charges and contributions, many otherwise viable projects will continue to be delayed or shelved, limiting the industry’s ability to deliver the housing supply NSW needs.
Ms Stevenson said the Property Council had also called for a coordinated push to unlock living sectors – including build‑to‑rent, purpose-built student accommodation, retirement living and land lease communities – through tax, planning and investment reform.
“This Budget takes some steps – notably with the foreign investor surcharge waiver – but it doesn’t deliver the system‑wide framework needed to scale these sectors, improve feasibility and materially lift housing supply.
“Today’s Budget sets a steady platform, but with the NSW 2027 Election firmly on the horizon, we’ll be looking to work with all parties to ensure the next phase of reform focuses squarely on feasibility and unlocking housing supply at scale.
“The coming months present a clear opportunity to set out a more ambitious policy agenda – one that addresses taxes, charges and delivery barriers to give the industry a fighting chance to turn approved projects into delivered projects.”
The Property Council will host NSW Treasurer Daniel Mookhey at a post-Budget address and Q&A – Inside the NSW Budget: A Conversation with the Treasurer – on Thursday 25 June.
